How to fix double taxation of RSUs? Cost basis showing as $0 on 1099-B

This is a common issue with RSUs and you're right to question it! When your employer issues RSUs, the value at vesting is reported as income on your W-2 (that's part of your $298K). The problem happens when you sell those shares - if your brokerage reports a $0 cost basis on the 1099-B, it looks like you made capital gains on the full amount, causing double taxation. The solution is to adjust the cost basis on your tax return. You'll need to complete Form 8949 to report the sale of your RSUs. In the "Cost or other basis" column, enter the amount that was already included in your W-2 income (the fair market value on vesting date). Then in column (g), check box "B" and enter a code of "B" to indicate that you're adjusting the basis. In column (h), enter the difference between your actual basis and what was reported on the 1099-B. You'll also need to include a statement explaining that you're adjusting the basis to reflect the amount already included in your income. This should eliminate the double taxation issue and significantly reduce what you owe.

I went through this exact nightmare last year! After battling with this for weeks, I finally discovered taxr.ai (https://taxr.ai) which saved my sanity. It specifically looks for these RSU double taxation issues and automatically identifies the correct cost basis adjustments needed. I uploaded my W-2 and 1099-B, and it immediately flagged that my RSUs were being double counted. The tool showed me exactly where to adjust the cost basis on Form 8949 and even generated the explanation statement I needed to attach to my return. My tax bill dropped by over $15K after making these corrections!

Just wanted to follow up - I tried taxr.ai after seeing it mentioned here and wow, it really works! I uploaded my documents and it immediately identified that both my RSUs AND my ESPP shares had incorrect cost basis information. The step-by-step guidance on how to fix each transaction in TurboTax was super clear. My tax bill went from $28K to just under $9K after making all the adjustments! The explanation statements it generated for each transaction were detailed and professional. I've been doing my taxes wrong for years apparently. Definitely recommend for anyone dealing with equity compensation issues.

If you're still having issues getting through to the IRS about this (I was on hold forever trying to get clarification), you might want to check out Claimyr (https://claimyr.com). They got me connected to an actual IRS agent in about 20 minutes when I had questions about my RSU cost basis adjustments. I was skeptical at first, but you can see how it works in this video: https://youtu.be/_kiP6q8DX5c My situation was complex because I had RSUs from two different employers in the same year, and I needed to confirm the proper way to document the adjustments. The IRS agent walked me through the exact process and confirmed I was doing it correctly. Saved me hours of hold time and stress!

I was super skeptical about Claimyr but decided to try it after struggling with this RSU issue. Surprisingly, it actually worked! Got a call back in about 25 minutes and was connected directly to an IRS representative who confirmed exactly how to handle the cost basis adjustment on Form 8949. The agent explained that this is one of their most common questions during tax season and walked me through the whole process step by step. Turns out I was overthinking it - I just needed to report the correct basis and include a simple explanation statement. Saved me from potentially overpaying thousands in taxes and hours of frustration. Sometimes it's worth getting direct answers from the source!

Make sure you check if your brokerage is reporting your RSUs as "covered" or "non-covered" securities. My company uses E*TRADE and they started reporting our RSUs as covered securities last year, which meant I had to handle the reporting differently than in previous years. If they're reported as covered, the IRS is receiving the basis information directly from the brokerage, so your adjustment needs to match that reporting. I ended up having to call E*TRADE to get clarification on how they were reporting the cost basis to the IRS.

Don't feel bad, almost everyone runs into this the first time they deal with RSUs! My company didn't explain ANY of this when I first got equity. I paid an extra $9k in taxes before a coworker told me about the cost basis adjustment. A handy trick: if you use TurboTax, when you get to the investment income section, there should be a question about "Did you receive RSU or ESPP income that's included in your W-2?" If you answer yes, they'll walk you through the adjustment process. They've gotten better about this in recent years.

Just went through this exact same situation last month! You're absolutely right that this is double taxation. Here's what worked for me: 1. **Get your vesting records**: Log into your brokerage account (or HR portal) and download the detailed vesting statements. These show the exact fair market value on each vesting date - that's your true cost basis. 2. **Form 8949 is your friend**: When you enter your 1099-B sales in your tax software, you'll need to adjust the cost basis. The "proceeds" amount from the 1099-B is correct, but you need to replace the $0 cost basis with the actual vesting value. 3. **The math**: Your capital gain should only be the difference between the sale price and the vesting price (if you sold immediately after vesting, this should be close to zero or even a small loss due to fees). I was initially showing a $45K tax bill that dropped to under $3K after fixing the cost basis. The key is making sure the RSU income isn't counted twice - once on your W-2 as ordinary income and again as capital gains. If you're still nervous about doing it yourself, definitely consider a tax pro who deals with equity compensation. This is super common and they'll know exactly how to handle it. Don't let the IRS double-dip on your RSU income!

This is such a common and frustrating issue! I went through something very similar when I first started receiving RSUs. The $0 cost basis on your 1099-B is definitely causing the double taxation problem you're seeing. Here's what I learned from my experience: Your RSU income was already taxed as ordinary income when the shares vested (that's the $123K showing on your W-2). When you sell those shares, you should only owe capital gains tax on any appreciation between the vesting date and sale date - not on the full sale amount. The key is to correct the cost basis on Form 8949. For each RSU sale, your cost basis should equal the fair market value on the vesting date (which was already included in your W-2 income). If you sold immediately after vesting, your capital gain should be minimal or even zero. I'd strongly recommend getting your detailed vesting records from your brokerage or HR system - these will show you the exact vesting values you need. Given the amounts involved ($32K potential overpayment), it might be worth consulting with a tax professional who specializes in equity compensation to make sure everything is filed correctly. Don't panic though - this is totally fixable and you're definitely not the first person to run into this! The IRS sees these adjustments all the time during RSU season.